How can your company save money? It’s an issue that just about every company deals with and one of the best methods is customer retention. Here are some of the ways it can save money over customer acquisition.
- Repeat Profits
Loyal customers are a plus over customer acquisition because they’re more like to place an order over and over again. They’re also more likely to place big orders when they do that. In fact, studies show customers are likely to spend one-third more than brand new customers.
What’s it all about? A customer that has bought from your company knows what your company offers and if it’s superior to rival companies’ offerings. They’re also more likely to think that your customer cares about their wants and needs. As a result, they’re also more likely to keep making future purchases.
Marketing can be a large part of any company’s budget so it’s important to minimize the costs as much as possible. Should you stop marketing altogether? You should avoid such an extreme step but spending more to keep your existing customers is a lot cheaper than marketing for Pathwwway customer acquisition. The more customers known about your company’s offerings the less money you’ll have to spend on marketing to find new customers.
- Customer Feedback
This is yet another way customer acquisition costs more than customer retention. What’s it all about? Customers that stay with your company are likely to provide helpful feedback to your company. In fact, one study showed that 97% of customers are likely to keeping buying from a company that puts their feedback into action. Meanwhile, the same study shows that over half of customers are unlikely to stay with a company that ignores their feedback.
It’s not enough just to read the feedback you get from customers. It’s just as important to consider how you can implement it in your company’s products, policies, etc. When you do that it shows that you’re not just listening to your customers but also valuing what they say.
- Free Advertising
Here’s yet another way customer retention is cheaper than customer acquisition. Advertising costs can be sky-high so it’s a major benefit when you can spend nothing for it. Repeat customers buy your company’s products because they value it and they’re also more likely than new customers to tell everyone they know about their experience.
This could include various channels like email or social media. What’s more important than the method is that you can enjoy free word-of-mouth advertising based on the positive experience of your loyal customers.
- Premium Prices
Studies also show that loyal customers are much more likely than new customers to pay premium prices for a company’s offerings. They value the company and know what they’ll be getting by paying premium prices. They have faith based on their past experience with your company that it can provide top-notch quality versus rival companies.
These are some of the ways customer acquisition is less cost-effective than keeping your existing customers.